EAST MILLINOCKET — Great Northern Paper Inc., the town’s largest taxpayer, is disputing its 1999 tax bill and asking the town for a $1.4 million tax refund.

The tax abatement request filed by Great Northern on Wednesday comes about two years after an agreement resolving a 1994 tax dispute between the town and paper company, which then was owned by Bowater Inc.

Great Northern recently appealed its 1998 dispute with neighboring Millinocket to the State Board of Property Tax Review. The company is seeking a $2.3 million tax refund from Millinocket.

Great Northern is disputing the more than $204 million value the town placed on all of its properties and equipment in East Millinocket, which includes its paper mill. The company’s 1999 tax bill was more than $3.4 million.

Great Northern paid 81.94 percent of the taxes raised in East Millinocket last year.

In the abatement request, the company said its value should be reduced by at least $84,125,580, which translates into a $1.4 million tax refund.

According to information from the Bureau of Taxation, the state listed $236 million as the 1998 value of Great Northern’s properties in East Millinocket. Figures for 1999 are not available, however, state officials said any change would be minimal.

“This overvaluation results from, among other things, the failure of the town to rely upon the appraisal it recently commissioned and obtained for this property,” stated GNP President Donald G. McNeil in the tax abatement application.

The three-member Board of Selectmen, who also act as the town’s assessors, disputed McNeil’s comment. Assessors said the town did not receive a final appraisal which Cascade Appraisal Service Inc. of Wilsonville, Ore., was to prepare.

In March 1997, town officials and representatives of Great Northern signed an agreement with the Oregon-based company to revalue the pulp and paper mill properties. The appraisal of mill properties was one condition of an agreement the town entered into with Great Northern in 1994 to settle a multimillion-dollar tax dispute. It required the mill properties to be revalued in 1997, with the town paying for the revaluation.

The new appraisal was to cost $125,500. But later, East Millinocket ended up paying more — about $165,000 — and because of a dispute about the appraisers’ bill, the town received no appraisal.

When selectmen received the Oregon company’s preliminary appraisal of the paper company in October 1997, they were shocked by the low value. Officials said it was less than half of the $245 million value used by the town in 1996. Selectmen said even Great Northern officials agreed the figure of $120 million was very low.

Selectmen hired William E. Van Tuinen Tax Assessment Services of Madison to appraise the mill. The Madison company appraised it at more than $200 million.

In January 1998, East Millinocket and Great Northern officials cut a deal. Town officials agreed they would try to convince local voters to establish a tax increment financing district for the company, which would provide about a $9 million tax break. Great Northern officials agreed to let the town off the hook on the issue of the mill’s value. The company agreed to let the town use the higher of the two mill appraisals, the one valuing the mill at $200 million.

Assessors said they are standing by the assessed value the town placed on the company for 1999. Officials plan to meet with the town’s attorney and its appraiser to discuss the matter.

“I don’t intend to move one inch,” said John Rouleau, chairman of the Board of Selectmen.

“I’m totally disgusted with the whole thing. We came to an agreement with Great Northern. They were satisfied with the assessment. To now say it’s worth about $120 million is totally ludicrous,” said Rouleau.

Other town assessors shared similar views.

“I thought when we agreed to a TIF package, they [Great Northern] had agreed to a value of $200 million,” said Selectman Bill Brunette. “It was their option to sell the mills, not mine. Whoever bought the mill bought the TIF and bought the value as far as I’m concerned. We stuck to our word as a community,” said Brunette.

Selectmen Jim Jamo said he could not believe where the company was coming from. “I know times are hard and if there was any way we could help our biggest taxpayer yes, but not $85 million, no,”said Jamo.